The UK economic recovery will take longer than the government thinks, executives claim.
A poll of 400 business leaders by consultancy Kroll found 72 per cent believe it will take between two to five years to see the economy return to the same level as 2019.
The figures are at odds with the Office for Budget Responsibility (OBR), the government’s Budget watchdog, which predicted the UK’s gross domestic product (GDP) will return to pre-crisis levels by the middle of 2022.
A significant third of respondents were not confident the UK would see the green shoots of recovery at all in 2021.
When asked about the biggest issues facing the UK economy, 40 per cent identified unemployment and a further 39 per cent highlighted the linked issue of corporate failures.
“The OBR is taking an upbeat view predicting an increase in UK GDP of four per cent in 2021, followed by around seven per cent in 2022,” Matthew Ingram, managing director of UK restructuring for Kroll, said.
“On its assumptions GDP could well be back to its pre-Covis-19 level by mid-2022.
“However, our polling has identified a very different sentiment amongst those business leaders who are at the coalface. The confidence of the OBR is simply not being shared in the wider economy.”
Ingram said corporate Britain feels like it’s “covered in sticking plasters right now and the confidence many business leaders are feeling as the economy finally opens up is being tempered with the legacy that the necessary government interventions will leave behind.”
“VAT deferments now need repaying, loans need servicing, staff need to be bought back off furlough, and rent arrears need settling,” he added.
“Corporate Britain has been piling up the debt and while that may have seen many through the pandemic, it will be an enduring challenge for many businesses as they look to the future.
“Our polling supports this as business leaders are acutely aware of the twin threats of unemployment suppressing consumer demand, and financial pressures as they come off government support.”